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The UN cannot lead us out of this crisis

D Ravi Kanth | Updated on April 16, 2020 Published on April 16, 2020

A defining moment for institutions tasked with international collaboration

Its multilateral bodies are short on vision and too dependent on financial powers to take charge, as the pandemic recedes

As economic historian Adam Tooze said, “an entire model of global economic development has been brought skidding to a halt” by the Covid-19 crisis, exposing the malignant methods which have worked to channel wealth to those at the top while draining the public purse and stretching public services — upon which the health and resilience of most of us depend — to a breaking point.

Scrambling for a response, policymakers from advanced economies have replaced the neoliberal mantra of “there is no alternative” with doing “whatever it takes”. These neo-liberal economic policies based on market fundamentalism have also contributed to the rapid spread of the Hindutva ‘virus’ in India.

Finding our way out

In rapid succession, novice UK Chancellor Rishi Sunak discovered his inner Keynes; US Treasury Secretary Steve Mnuchin became an (unwitting) advocate of universal basic income; and German Chancellor Angela Merkel abandoned her religious devotion to strict debt and fiscal rules. Whether this will be enough to prevent another Great Depression remains to be seen. As Tooze warns, with the main centres of economic and political power disoriented, it is unclear “who will lead the way out of the crisis”.

Ideally, the job should fall on those institutions tasked with international cooperation and coordination. The signs so far are mixed. Unlike in 2009, the G20 has mainly served as a platform to advertise the efforts of leading economic powers, rather than as a genuine coordinating body. The Washington-based financial institutions, by contrast, have been more proactive with proposals on liquidity provision, development finance and debt relief, but these still need political endorsement; and as Tooze makes clear, only the US Federal Reserve has the financial firepower to step in as a global lender of last resort, which it has done imperfectly.

This should also be a defining moment for institutions clustered under the United Nations’ umbrella. António Guterres, the UN Secretary-General, has talked the talk in several of his speeches; but in reality, he oversees an institution enmeshed in serious budgetary difficulties and subject to endless reforms which promise (but never deliver) to do more with less.

While the UN is in its 75th year, this seems to be a good moment to ask whether its sprawling architecture is what is required for a post-crisis world seeking a more resilient, sustainable and inclusive future. Geneva is the ideal place to reflect on that, given its multiple agencies that are covering a range of challenges exposed by this crisis.

Varying influence

The World Health Organization — very much in the eye of the Covid-19 storm — has had a difficult few weeks. Established in 1948, it was the first UN agency with universal membership, mandated to control the spread of contagious diseases, backstop public health programmes, formualte standards on nutrition and hygiene and establish a centre for comparative health data. But as historian Mark Mazower has argued, from its earliest days, the WHO was under pressure from the US government to adopt a technical assistance approach to disease eradication, in line with advanced pharmaceutical interests, rather than an global advocate of public health policy.

With an ever-expanding portfolio of technical projects, largely determined by the main donor countries and run by bureaucrats from Geneva, the institution has lost much of its original multilateral purpose and intent. In the early 2000s, former WHO Director-General Gro Harlem Brundtland salvaged something of its original reputation with her response to the SARS crisis, but that did not survive her departure. Its current Director-General, Tedros Adhanom Ghebreyesus, has been criticised for falling short of the standards of an international civil servant. While there is some truth to this, the institution had sacrificed its independence to moneyed influence (donors, corporates, and philanthropists) well before his arrival.

The World Trade Organization is the most recent arrival to the multilateral family based in Geneva. Emerging from the GATT as the custodian of the Uruguay Round’s expanded trade agenda and a standard bearer for open and efficient global markets, it is uniquely blessed with a dispute mechanism that can discipline reprobate governments that break its rules. This has made it the institution of choice for advanced countries determined to promote the kind of corporate-friendly rules that align with their own economic interests. That two-stage dispute mechanism almost died in December, as the US spread its unilateralism virus.

Its current Director-General, Roberto Azevado, who had exhibited development sensitivities as Brazil’s Ambassador to the WTO, has consistently toed the neo-liberal line, indifferent to the Doha Development Agenda, pushing for liberalisation in new areas and championing institutional reforms in line with the efforts of Western governments to prevent any repetition of China’s use of flexibilities in the trade rules to advance development. Profit, not people, is what needs to be protected; and getting back to the business of protecting profits has been Azevado’s message during this crisis.

Nothing to contribute

A different message might be expected from Azevado’s counterpart at the UNCTAD, an organisation established over 50 years ago by developing countries to support their efforts to redress the biases and asymmetries in the trading system. In truth, the UNCTAD has been drifting in a neoliberal direction since its nineth conference in South Africa in 1996, albeit with moments of resistance by previous Secretary-Generals from Brazil and Thailand.

While pockets of the organisation cling to its original mission, its current head, former Kenyan trade minister Mukhisa Kituyi has, as for most of his tenure at UNCTAD, been noticeable in the crisis by his absence. Known for dividing his time between consolidating business interests back home and indulging his passions for international travel and golf, under his stewardship UNCTAD has lost its direction at the very moment developing countries are desperate for guidance on how to mitigate the impact of the crisis.

If the UNCTAD has been largely missing in action, the UNECE has been lying face down in the neoliberal mud for years. The first of the UN’s regional commissions with an early cast of strong leaders, beginning with the Nobel economist Gunnar Myrdal, it was neutered by the European Commission when the Berlin Wall fell; and has since been run as a collection of market-friendly technical assistance projects for transition economies by a string of faceless bureaucrats, largely from the Eastern fringe of the European Union. Its current Executive Director is described on the institutions website, in characteristic UNese, as bringing “to the position a combination of leadership and diplomatic skills with deep knowledge of the region, with its challenges and opportunities, and a strong focus on building and nurturing partnerships among key stakeholders with the United Nations.” As Europe breaks down in the face of the crisis, the institution has had nothing meaningful to say.

Geneva is, no doubt, a pleasant enough place from which to indulge in the niceties of international diplomacy. But its multilateral credentials have been withering on the vine of comfortable complacency for years, too distant from the harsh realities of neoliberal capitalism in the developing world, too dependent on the big financial players in Washington for policy guidance and too close to the big European donors for the money that keeps the Geneva international machine ticking over.

If, as the UN Secretary General says, we must build a better future after this crisis, he will need to begin by taking a long look at his old stomping ground and consider why in the face of the single biggest multilateral challenge since its establishment, too many of the UN institutions under his purview no longer appear fit for purpose.

Published on April 16, 2020

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